LONGFOR GROUP(HK:00960)2022-04-19 22:08Financial Performance - Longfor Group reported a total revenue of RMB 100.5 billion for the year 2021, representing a year-on-year increase of 15%[7]. - The company achieved a net profit of RMB 12.3 billion, which is a 10% increase compared to the previous year[7]. - In 2021, the Group achieved contracted sales of residential properties amounting to 290.1 billion yuan, representing a year-on-year increase of 7%[67]. - The recurring income from commercial properties, rental housing, and property management services reached 18.8 billion yuan, with a year-on-year increase of 39%[67]. - The core attributable profit increased by 20% in 2021, demonstrating the Group's commitment to performance[67]. - In 2021, the Group's revenue from property development was RMB 204.55 billion, representing a 19.6% increase compared to the previous year[73]. - The total gross floor area (GFA) delivered by the Group was 13.77 million square meters in 2021[74]. - The gross profit margin for the property development business was 23.0% in 2021[74]. - The average selling price recognized was RMB 14,852 per square meter in 2021[74]. - The Group's property investment business generated rental income of RMB10.41 billion, a 37.5% increase from the previous year[83]. - The overall occupancy rate of the Group's shopping malls was 97.2%, with 594,000 square meters of operational space[83]. - The Group's rental income, net of tax, for 2021 was RMB 10.41 billion, representing a 37.5% increase compared to the previous year[85]. - The Group's total contracted sales in 2021 were RMB290.09 billion, compared to RMB270.61 billion in 2020, indicating a positive growth trend[81]. - The Group's shopping malls have a total operational area of 5.94 million square meters with an occupancy rate of 97.2%[85]. - The average selling price of GFA sold was RMB16,975 per square meter, up 1.4% from the previous year[78]. - Profit attributable to shareholders rose by 19.3% to RMB 23.85 billion, compared to RMB 20.00 billion in the previous year[198]. - Core net profit, excluding minority interests and valuation gains, increased by 20.1% to RMB 22.44 billion from RMB 18.69 billion[198]. Project Development and Expansion - Longfor plans to launch 15 new projects in 2022, aiming for a sales target of RMB 120 billion, which reflects a growth of 20%[7]. - The company has a land bank of approximately 30 million square meters, with 70% located in tier-one and tier-two cities[11]. - The company has a total of 22 ongoing projects with a combined gross floor area (GFA) under development of approximately 2,000,000 sqm[17]. - The company is actively expanding its portfolio with new projects in Guiyang, including the Star Glamor project with a 90% interest and a GFA of 519,703 sqm, expected to be completed by November 2024[15]. - The company is focusing on strategic land acquisitions to enhance its market position and future growth potential[116]. - The company is expanding its project portfolio with multiple new developments across major cities, including Chengdu, Xi'an, and Lanzhou[111]. - The company is actively pursuing new projects and market expansion strategies in key regions, focusing on high-potential urban areas[110]. - The company has a strategic focus on expanding its residential and commercial property portfolio across key cities in China[19]. - The company is planning new developments, including 329,266 square meters in Ningbo Binjiang, expected to be completed by January 2025[63]. - The company has a significant interest in future projects, such as the Dongguan TOD Suzhou Xiangcheng with a completion date of April 2024, covering 211,615 square meters[63]. Sustainability and Corporate Responsibility - Longfor has committed to sustainability initiatives, aiming for a 30% reduction in carbon emissions by 2025[7]. - The Group is committed to integrating social responsibility into its development principles, focusing on energy conservation and emission reduction[71]. - Longfor Group is committed to sustainable development, with several projects incorporating green building practices and community-focused designs[15]. - The Group aims to achieve carbon peaking and carbon neutrality goals through the promotion of green building standards[71]. - Future guidance indicates a commitment to sustainable development practices across all new projects, aligning with market trends towards eco-friendly construction[58]. Market Strategy and Positioning - Longfor Group's strategic focus includes enhancing its market presence through acquisitions and partnerships in emerging markets[15]. - The company is exploring strategic acquisitions to enhance its market position and diversify its portfolio in the coming years[7]. - The company is focusing on commercial properties, with several projects designated for commercial use, such as the Wuxi Xishan Paradise and Changsha Kaifu Paradise Walk[61]. - The company has a strategic plan for acquisitions and expansions, targeting high-growth areas in major cities across China[62]. - The company is expanding its market presence with new projects in cities like Jinan and Changsha, with completion dates set for late 2023[62]. Corporate Governance and Management - The Company adopted and complied with the Corporate Governance Code effective during the year ended December 31, 2021[138]. - The Board comprises eight directors, including four executive directors and four independent non-executive directors, ensuring a strong independence element in its composition[141]. - The Company emphasizes the importance of corporate transparency and accountability to enhance corporate value[138]. - The establishment of a nomination committee on December 29, 2021, reflects the Company's commitment to governance[138]. - The Company has engaged external professional agents to regularly reassess and evaluate its internal control system[168]. - The Company has strengthened daily monitoring and improved internal management through the introduction of various management systems[169]. - The Company has arranged and funded appropriate training for directors to keep them updated on operational developments[164]. - The Company has established an internal audit department responsible for reviewing the effectiveness of the internal control system and reporting results to the Audit Committee and the Board[169]. Financial Management and Debt - By the end of 2021, the Group's net debt ratio was 46.7% and the average financing cost was 4.14%, both remaining stable[68]. - The Group's consolidated borrowings amounted to RMB192.07 billion, with cash in hand of RMB88.53 billion, resulting in a net debt to equity ratio of 46.7% and a liabilities to asset ratio of 67.4%[120]. - The proportion of fixed interest debt was 40% of the total debt as of December 31, 2021, down from 46% the previous year[120]. - The Group successfully issued corporate bonds of RMB9.0 billion and medium-term notes of RMB1.0 billion in 2021, with coupon rates ranging from 3.35% to 4.40% per annum[120]. - The Group aims to maintain a sound financial management strategy, focusing on low-cost, multi-channel financing and a reasonable debt level for stable and sustainable development[126]. Employee and Talent Management - The Group employed 44,065 full-time employees as of December 31, 2021, with an average age of 32.9 years[121]. - The Group focuses on retaining and training management talents to ensure effective leadership[140]. - The Group's focus on high-quality talent and organizational efficiency contributed to improved project acquisition and sales performance in Tier-1 and Tier-2 cities[96]. Digital Innovation and Technology - Longfor Group launched the "Longfor Intelligent Living" brand in early 2022, focusing on smart lifestyle and space services[68]. - The Group plans to expand its digital technology services across various external business scopes, including membership points management and intelligent parking system services[95]. - The Group aims to enhance its digital business scale and service capacity through continuous innovation in operational management and process improvement[95]. - The company is actively pursuing new technology developments to enhance project efficiency and sustainability[19].